Green, Green Potter, for appellant.

The court below on a demurrer to a declaration held this act violative of section 112 of the Constitution. But, with deference, that section does not apply: (a) To privilege taxes: Clarksdale Insurance Agency v. Cole, 87 Miss. 637, 40 So. 228; State v. Lawrence, 108 Miss. 291, 66 So. 747; Postal Telegraph Co. v. Robertson, 76 So. 562, 116 Miss. 204. (b) To special assessments: Daley v. Swope, 47 Miss. 369; Cox v. Wallace, 100 Miss. 525, 56 So. 461; Jones v. Drainage District, 102 Miss. 796, 59 So. 921. (c) To excise taxes: Hattiesburg Grocery Co. v. Robertson, 88 So. 4, 126 Miss. 34; Enochs v. State, 97 So. 534 (Miss.).

The decision made was predicated upon a demurrer, not on a full development of the facts requisite, so that if there is any possible state of case under which this act may be found constitutional, it is obligatory upon this court to assume that condition to exist because an act of the legislature raising revenue is not to be stricken down save when void beyond a reasonable doubt, and then only at the express instance of one whose right is transgressed thereby. Lamar Life Insurance Co. v. Jackson, 95 So. 855, 132 Miss. 838.

Let us assume that all of the physical property, including good will and going value, of the Lumber Mineral Company, was situated in Mississippi, with nothing outside of the state except its domicile. The legislature well knew it could not tax the shares of a corporation so situated upon a basis different from that of a local corporation. Both must be taxed alike. Chalker v. Birmingham, etc., R.R. Co., 249 U.S. 522; Guano Co. v. Virginia, 253 U.S. 412; Insurance Co. v. Conn., 185 U.S. 366; R.R. Co. v. Green, 216 U.S. 417.

Under the Federal Constitution, therefore, when a foreign corporation has all of its property located within Mississippi though chartered by another state, it may be, constitutionally, taxed on all of said property, and, in addition thereto, upon its stock, when a Mississippi corporation is taxed only on its property and not on its stock.

We do not seek to exclude taxation of all corporate property to the same extent as property owned by an individual. Every character of property corporatively owned is taxable when similar property of an individual is taxed. But shares of a corporation doing business in Mississippi with its property locally sitused, cannot be constitutionally taxed both upon its physical property and upon the shares as well. Robertson v. Mississippi Valley Co., 81 So. 800, 120 Miss. 169.

All of the property of a foreign corporation being situated in a foreign state from which the corporation as such could not migrate, a resident of Mississippi obtained an interest in such property so thus there taxed by the sovereignty which created it but had his participation in such foreignly sitused property evidenced by a certificate of ownership — a corporate stock certificate. That was in Mississippi wherein the corporation did no business. It was contended that state taxation in virtue of individual ownership of corporate shares in a foreign corporation whose entire property was extraterritorial, violated the Federal Constitution. Hawley v. Maulden, 232 U.S. 8, 58 L.Ed. 481; Kidd v. Alabama, 188 U.S. 730, 47 L.Ed. 669. But this power, though existent, need not be exercised when its exercise imposes double taxation — a most unjust and onerous burden.

Therefore, when Mississippi found no revenue was being paid upon foreign shares because of the intolerable burden that would arise from such taxation, and that the actual property representing these shares was sitused in a foreign state, and not, as such, taxable in Mississippi, in pursuance of a wise policy, the legislature recognized the equity of the situation as to those corporations which had no property of any kind in Mississippi, and imposed this privilege tax upon the right of a resident to own these certificates substantially equivalent to a stamp tax.

Our interpretation of this privilege tax act is that it applies solely and only to shares of stock owned by residents of Mississippi where there is no property in Mississippi of the corporation as such subordinate to state sovereignty and taxed ad valorem, but only to that type of corporation wherein the Mississippian owns an interest evidenced by a stock certificate in property possessed by an aggregate of individuals, a corporation sitused in a foreign state.

What is a nonresident corporation in the purview of this statute? We answer only a corporation that does no business in Mississippi and has no property subject to ad valorem taxes therein. All doubts are resolved in favor of the citizen and against the state in the construction of a privilege tax. Johnson v. Oil Refining Co., 108 Miss. 416; Ex Parte Taylor, 58 Miss. 478; Wilby v. State, 93 Miss. 767.

A nonresident, therefore, under this act, is one that does no business in Mississippi. This act must not be stricken down until, unless and except it is unconstitutional beyond a reasonable doubt. Johnson v. Reeves, 112 Miss. 227, 72 So. 925; State v. Wheatly, 113 Miss. 55, 74 So. 429.

The duty of the court is accurately expressed in City of Jackson v. Mississippi Fire Insurance Co., 95 So. 848. Securities Mutual Insurance Co. v. Prewitt, 200 U.S. 246, 50 L.Ed. 1013, remains the law except as modified by Terral v. Construction Co., 257 U.S. 729. Now with this absolute power to exclude, with the property of the foreign corporation fully taxed in its home state, it is objected that section 112 of the Constitution is operative to destroy this law. With the utmost deference, that is not true, and is demonstrably not true under the present decisions of this court.

Much stress will be placed upon two cases, in each of which we were counsel. Thompson v. Kreutzer, 112 Miss. 165, and Thompson v. McLeod, 112 Miss. 383, but these cases are readily distinguishable.

The Kreutzer case and the McLeod case had to do with realty irrevocably located in Mississippi, beyond the power of the legislature to otherwise provide. Land in Mississippi must always remain subject to the laws of Mississippi as property. The Lord when He made the earth gave it a position, and it is here held by His immutable command. But a share of stock evidencing ownership in a nonresident corporation has no situs fixed either by the law of God or the Constitution.

There is no mandate in the Constitution situsing shares of stock in foreign corporation without the physical property in Mississippi. The legislature has plenary power to regulate, and, in regulating, can exercise unlimited discretion. City of Vicksburg v. Armour Packing Co., 24 So. 224; Adams v. Colonial Mortgage Co., 82 Miss. 263; Blackstone v. Miller, 188 U.S. 428, 47 L.Ed. 188; People v. Commissioners, 23 N.Y. 224; Taylor on Private Corporations, sec. 51, Page 28; Securities Co. v. State, 91 Miss. 195; Jane v. Martinez, 104 Miss. 208, 61 So. 177.

This is an excise upon the right of a foreign corporation to do business in Mississippi, because the distribution of its shares in Mississippi is clearly within the regulatory power of Mississippi in virtue of its sovereignty. Harry T. Hall v. Geiger- Jones Co., 242 U.S. 538, 61 L.Ed. 480; Caldwell v. Sioux Falls Co., 242 U.S. 559, 61 L.Ed. 493.

In short, it has been held that Mississippi may entirely exclude foreign corporations from its borders. L. N.R.R. Co. v. State, 107 Miss. 579; Bank v. Earl, 13 Peters, 519, 10 L.Ed. 819; Paul v. Virginia, 8 Wall, 168.

So, having power to exclude, and being vested with supervisory discretion, it may exercise its sovereignty by the creation of an excise tax for the enjoyment of a right in Mississippi as to foreign property wherever Mississippi exercises no sovereignty and, in this aspect, the Kreutzer case and the McLeod case have nothing in common with the case at bar, or the statute struck down. Enochs v. Robertson, 97 So. 534, 128 Miss. 361; In re Deseret, 46 L.R.A. (N.S.), 791; Hattiesburg Grocery Co. v. Robertson, 88 So. 4, 89 So. 368, 126 Miss. 34.

The right to do business in Mississippi by a foreign corporation is a privilege, and that privilege is taxed, and unquestionably taxed, and has been the source of revenue from time immemorial. Powell v. Calvert Mortgage Co., 112 Miss. 319, 73 So. 51.

Is this imposition upon the right to own stock in a foreign corporation which cannot come into Mississippi without the state's consent, a privilege tax? Unquestionably and undoubtedly, it is, and so being, thereby the right to tax can only be determined by demonstrating that under the guise of privilege taxation ad valorem direct tax has been imposed, and no such condition is demonstrable. The legislature surely did not intend to evade its responsibilities, and invalidate the Constitution by assuming to do that which it had no right to do. See Coca-Cola Co., 91 Miss. 677. As to Dawson v. Kentucky Distilling Co. etc., 255 U.S. 288, 65 L.Ed. 638, note the decision in Oliver Iron Mining Co. v. Lord, 262 U.S. 171, 67 L.Ed. 930.

But, there is another conception. By the case of City of Jackson v. Mississippi Fire Ins. Co., 95 So. 847, reviewing all preceding decisions, it has been firmly and finally settled that the legislature may exempt from taxation such property as it deems proper.

Substantially under these decisions, the Constitution of 1890 as to exemptions has been made exactly equivalent to the Constitution of 1869. That is to say, the court, at present, contrary to Railroad Co. v. Adams, 77 Miss. 194, recognizes as the controlling decision Mississippi Mills v. Cook, 56 Miss. 40.

In short, this court now concurs with WOODS, Chief Justice, and has departed from that which was established by Justice WHITFIELD in the majority opinion. Therefore Mississippi stands now with a legislature vested with precisely the same power as was vested in the legislature during the time of the Constitution of 1869, and under the Constitution of 1869, in the matter of exemptions, it was constitutional for the legislature to fix, raise and commute. Bank v. Worrell, 67 Miss. 47; Board of Supervisors v. Gulf Coast Military Academy, 89 So. 617; Postal Tel.-Cable Co. v. Adams, 71 Miss. 556, 14 So. 36; Adams v. Bank, 75 Miss. 701, 23 So. 395, and Bank v. Adams, 78 Miss. 732, 29 So. 400.

Was the right of the legislature to exempt this property from all taxation absolute and unconditional? Now if this right exists, namely, an absolute right, an unconditional right, of necessity, the greater will contain the less, therefore, with deference, the result is that the power to exempt, as now existing, embraces the power to partially exempt, or to commute. This tax might be taxed as a commutation tax, and supported on that predicate. Floyd Easterling, also for appellant.

The question sought to be presented to the court for decision is simply this: Are shares of stock held by a resident of this state in a foreign corporation taxable in this state? Sec. 112 of the Constitution.

Section 6878, Hemingway's Code, declares the law and policy of the state in regard to exemption from taxation, and the said section provides in the first paragraph that, "The following property, and no other, shall be exempted from taxation.

Section 6888, Hemingway's Code, declares that: "All taxable property brought into the state or acquired or held by any person before the first day of February shall be assessed and taxes thereon paid for the current year."

Section 6904, Hemingway's Code, providing for the publication of printed lists for taxpayers to be used by the assessors, contains the requirement that the taxpayer give in for taxes the "value of all shares or certificates of stock in any corporation, stock company or association, domiciled outside of the state."

Pursuant to the authority of chapters 134 and 135, Laws 1918, the state tax commission re-adopted this provision in the form promulgated by it. Section 6905, Hemingway's Code, further provides that this list shall have appended to it the oath of the taxpayer, and section 6906, Hemingway's Code, provides that the tax list of every person shall be made out on one of the printed lists and filled in with ink, etc.

It is therefore clear that the legislature clearly intended all personal property to be taxed except that, specifically exempted by statute, for an exemption is never presumed, but the burden is upon the claimant to establish it. Morris Ice Co. v. Adams, 75 Miss. 410, 22 So. 944; Sturges v. Carter, 29 L.Ed. 240; 2 Cooley on Taxation, 1404.

That shares of stock in a corporation, whether such corporation be domestic or foreign, can be taxed in the hands of the owner has as a general proposition been too well settled to admit of serious discussion. Shares of stock are a species of personal property and as such are subject to the usual burden of taxation borne by other property. Apart from constitutional and statutory prohibitions there is nothing to prevent the state from taxing the corporation on its property and assets and also taxing the shares of stock in the hands of its stockholders. They constitute separate taxable entities and to tax each is not double taxation. 26 R.C.L. 184; Farrington v. Tenn., 23 L.Ed. 228 (560); Bradley v. Bauder, 36 Ohio St. Rep. 28, 38 Am. Rep. 547; Sturges v. Carter, 29 L.Ed. 240; Wright v. L. N.R.R., 49 L.Ed. 167, Fletcher's Cyc. Corporations, 7, 8185; Greenleaf v. Board of Review, 184 Ill. 226, 75 Am. St. 168, 56 N.E. 295; Kidd v. Alabama, 47 L.Ed. 669; Darnell v. Ind., 226 U.S. 390, 57 L.Ed. 267; Hawley v. Malden, 232 U.S. 158, Ann. Cas. 1916 C 842; Judy v. Beckwith, 137 Iowa 24, 15 Ann. Cas. 890, 15 L.R.A. (N.S.) 142; Bacon v. Bd. State Tax Commrs., 126 Mich. 22, 86 A.S.R. 522, 60 L.R.A. 321; Lee v. Sturges, 46 O. St. R. 153, 2 L.R.A. 556; 37 Cyc. 757, and annotations thereto. See comprehensive note to State Board of Equalization v. People, etc., 58 L.R.A., 577, et seq.; Coca-Cola Co. v. City of Atlanta, 152 Ga. 558, 110 S.E. 730; 23 A.L.R. 1339. The case of Robertson v. Miss. Valley Company, is not authority against the taxation of shares of stock in a foreign corporation to a citizen of this state. 120 Miss. 159, 81 So. 7991.

All that was held by an evenly divided court was that a domestic corporation cannot be taxed on that portion of its capital stock which is invested in shares of the capital stock of another domestic corporation. However in regard to the liability for taxation of shares of stock in a domestic corporation it is urged and acquiesced in that in the case of Simmons v. State, 70 Miss. 485, 12 So. 477, this court construing pertinent statutes, held it not to be the intent and language of the laws of this state to impose taxes on shares of stock in the hands of the owner in a domestic corporation. This decision was based entirely on a consideration of the statutes of the state and merely held that in contemplation of our statutory scheme of taxation of a domestic corporation the corporation itself paid the tax, computed not on the value of its real and personal tangible property alone, but on the value of its outstanding capital stock as augmented in value by its surplus and undivided profits. Section 6901, Hemingway's Code, is the present statutory provision relating to this subject.

LOCATION OF PROPERTY IN THIS STATE OF FOREIGN CORPORATION CREATES NO EXEMPTION OF RESIDENT-OWNED SHARES. We apprehend that counsel representing an opposing view will, when driven by the overwhelming weight of authority on this general proposition, concede that the conclusion is inescapable that under our Constitution and statutes stock in a foreign corporation is unquestionably taxable in the hands of a resident of this state, but that an exception exists in favor of such stock when a part of its corporate property is located in and taxed in this state, and that such a state of facts exists in this case. However, an effort to engraft such an exception upon the expressed laws of this state is no less violative of the tenets of sound construction quoted above, than would be the whole contention of which the latter is but a part.

Lest we be swayed by an argument based on an analogy to domestic corporations and the familiar cry of a denial of equal protection of the laws it is well to revert to the holding of the supreme court of the United States in Kidd v. State of Alabama, 47 L.Ed. 669, where the court unequivocally stated that the equal protection of the laws is not denied by the provision of the Alabama statutes taxing foreign stock when stock of a domestic corporation is exempted. See Coca-Cola Co. v. City of Atlanta, 152 Ga. 558, 110 S.E. 730, 23 A.L.R. 1339; Commonwealth v. Walsh's Trustee, 106 S.W. 240.

In 7 Fletcher's Cyc. Corporations, 8080, is found a very clear and interesting discussion of the question of the situs for purposes of taxation of the franchise and other intangibles of a foreign corporation. See, also, Foster-Cherry Commission Co. v. Caskey, 66 Kan. 600, 72 P. 268; Com. v. Standard Oil Co., 101 Pa. St. 119; Gloucester Ferry Co. v. Pennsylvania, 114 U.S. 196, 29 L.Ed. 158; Pullman Palace Car Co. v. Penn, 141 U.S. 18, 35 L.Ed. 613; St. Louis v. Wiggins Ferry Co., 11 Wall. (U.S.) 423, 20 L.Ed. 192.

The above argument and authorities cited demonstrate beyond doubt the soundness of the proposition that no foreign corporation doing business in this state, however much or little, can be legally taxed on its entire property in this state, and this is true regardless of whether such foreign corporation has its interest invested exclusively in this state, together with its sole place of business. It therefore follows that it cannot claim that it is, or can be, taxed the same as a domestic corporation, for the simple reason that its intangible property and franchise have a situs at its legal domicile and not at the actual place of business of the corporation.

This should refute any argument addressed to this court asking it to declare any policy in regard to taxation that will be discriminatory as against domestic corporations. If such foreign corporation as above referred to should go so far as to pay ad valorem taxes on its real property in this state and all its tangible property, there yet remains an important and unknown element of value not taxed by this state, as its capital stock, used in sense of including the value of both tangible and intangible property under the authorities cited above cannot be taxed.

FRANCHISE OF DOMESTIC CORPORATIONS MUST BE TAXED IN MISSISSIPPI. That the franchise of a corporation is required to be taxed under the laws and Constitution of this state has been often established by this court. People's Warehouse Company v. Yazoo City, 97 Miss. 500, 52 So. 481; Simmons v. State, 70 Miss. 485, 12 So. 477; Robertson v. United States Nursery Co., 83 So. 307; Adams v. Bullock, 94 Miss. 27.

As to the difference between the value of tangible corporate holdings and the value of the capital stock on the market, the court held that this excess value represented the value of the franchise to be a corporation, and that this value of the franchise might be taxed just as the value of any other corporate property.

In sustaining this proposition the court quoted with approval from Commonwealth v. Cary Improvement Co., 98 Mass. 19. Adams Express Co. v. Ohio, 166 U.S. 185, 17 Sup. Ct. 604, 41 L.Ed. 965.

The court cited notes to the case of Louisville Tobacco Warehouse Co. v. Commonwealth of Kentucky, 106 Ky. 165, 49 S.W. 1069, 57 L.R.A. 33, in holding that a franchise is property and as such taxable, and though admitting that there was a difference of opinion in some jurisdictions as to the nature of the property, said: "We adopt the view of such courts as hold that a franchise of this character is personal property and taxable as such." After thus definitely committing itself on this proposition the Mississippi supreme court cited the case of Panola County v. Carrier Son, 89 Miss. 277, 42 So. 347, for the purpose of showing how corporations should be taxed.

SUPREME COURT OF THE UNITED STATES ON THE TAXABILITY OF SUCH SHARES UNDER FEDERAL AND STATE CONSTITUTIONS. Wright v. L. N.R.R. Co., 49 L.Ed. 167; Sturges v. Carter, 29 L.Ed. 240; St. Louis Southwestern R. Co. v. Arkansas, 59 L.Ed. 265; Kidd v. Alabama, 188 U.S. 730, 47 L.Ed. 669, aff'g; State v Kidd, 125 Ala. 413, 28 So. 480.

EXEMPTIONS MUST BE EXPLICIT. Farrington v. Tenn., 24 L.Ed. 558.

PERPLEXITIES OF ADMINISTRATION INCIDENT TO JUDICIAL CONSTRUCTION SOUGHT BY APPELLEE. If the court should sustain any suggestion of appellee's counsel and engraft into our organic scheme of corporate taxation an exception to the effect that stock in a foreign corporation is not taxable when it has all of its tangible personal property, and real estate in this state then the administrative laws of this state will be burdened with perplexities so great and numerous as to be tantamount to their complete nullification.

Frankly we should be glad indeed to see chapter 129, Laws 1924, upheld, if possible, but as stated at the outset of our brief we are unable to conclude to our satisfaction that it is valid. In this condition of things we respectfully show to this court that it should construe our existing statutes as unconditionally imposing a uniform ad valorem tax on this class of investment as a whole, and thereby permit the legislature to change the law, if it sees fit to modify the conditions under which this stock may or may not be taxable. At the same time the same legislature could provide necessary administrative machinery for the determination of all the details incident to such a change. Frankly, we see no useful purpose or policy to be subserved in changing any feature of the law, if our interpretation is upheld.

It has been the privilege and duty of the writers of this brief to review statutory provisions of practically all the states on the subject involved. A compilation of such laws may be found in The Corporation Manual, published by "The Corporation Trust Company of New York" and may be found in the state library. It may be true that Mississippi has not provided the statutory conditions pertaining to the exemption of foreign stock, as found in some states. At the same time its laws are on a parity with many of the states where abounds a large part of the capital of the nation.

In spite of doubts and propaganda sometimes to the contrary we maintain that the corporation laws of the state of Mississippi are friendly and inviting to capital, and that under its expressed scheme of taxation favorable to domestic corporations no one should be heard to complain when taxed with the ownership of shares in a foreign corporation purposely expatriated for reasons of self-convenience to obtain some privilege or immunity for which it pays nothing to this state in return for the governmental protection it enjoys. To such a corporation the courts of the state are open, the constabulary of the state for the protection of its property always at hand, and moreover the acquisition and exploitation of our virgin resources open to their enjoyment and profit. As was said in one of the authorities we read in our research: Under such circumstances the owner of such stock can change his residence, or change his investment, or, more properly, change the domicile of his company and enjoy the beneficent laws intended for the corporate children of the state.

A foreign corporation pays no annual franchise tax to this state, as in most states. It makes no contribution to the burdens of government, except as it pays ad valorem taxes on the mere physical property having a taxable situs herein. As a policy bent upon building up the state in respect to its invested capital it occurs to us that of paramount consideration is a judicial clarification of our existing revenue laws as a forerunner to appropriate legislation where necessary. Of great importance is the question submitted here. From the consideration of policy we submit that a strict construction of our statutes will redound to the benefit of our state. It will keep capital at home and take the premium off foreign incorporation of our local industries. It will make more reciprocal the relations between government and property. It will foster patriotism and civic pride. It will confine controversies between our citizens and corporations in this state to the judicial tribunals of our state. It will remove unjust discrimination against domestic corporations, which assume their full share in the burdens of government.

Watkins, Watkins Eager, for appellee.

CHAPTER 129, MISSISSIPPI LAWS OF 1924, UNCONSTITUTIONAL, AND THEREFORE UNENFORCEABLE. In support of the foregoing proposition we cite Thompson, Auditor, v. Kreutzer, 112 Miss. 165; Thompson, Auditor, v. McLeod, 112 Miss. 383; Crittendon v. Town of Booneville, 92 Miss. 277; Murray v. Lehman, 61 Miss. 283; Adams v. Mississippi State Bank, 75 Miss. 701.

APPELLEE'S SHARES OF STOCK IN THE LUMBER-MINERAL COMPANY WERE NOT SUBJECT TO ASSESSMENT FOR AN AD VALOREM TAX, BECAUSE ALL THE PROPERTY OF THE FOREIGN CORPORATION, WHETHER REAL OR PERSONAL WAS SITUATED IN THE STATE OF MISSISSIPPI, ASSESSED FOR TAXATION AS THE PROPERTY OF OTHER PERSONS, AND TAXES PAID THEREON IN AN AMOUNT IN THE AGGREGATE EQUAL TO ITS CAPITAL STOCK. The question arises under the second count in appellant's declaration, as to whether or not shares of stock in a foreign corporation doing business in the state of Mississippi, where all of its real and personal property is situated in the state and taxes paid thereon, may be assessed under the laws and statutes of the state of Mississippi to the individual owner thereof.

It must be borne in mind that the question is not exactly one of exemption from taxation but the question involved is as to whether or not property which has been taxed in one form or species is subject to taxation under a different guise. Some of the judges in the adjudicated cases, to which we will refer, use the word "exempt," but this term is in no sense accurate.

Our position is that property in Mississippi is taxed but once. Double taxation violates the fundamental law of the state of Mississippi, and where the property of the corporation has been taxed, then, for all substantial purposes section 112 and section 181, of the Constitution, as well as the statutes passed in pursuance thereof to put into effect the constitutional mandate, have been fully complied with. This distinction we wish to impress upon the mind of the court at the threshold of the argument and it must be borne in mind. In a certain sense the shares of stock in the hands of the owner are separate property from that of the corporation; but that is true only in a theoretical sense; for all practical and substantial purposes, they are the same. 7 R.C.L., par. 277, subject "Corporations."

The shares of stock have no value, except for the property back of them owned by the corporation. Some law writer has said that a corporation is like an individual — it comes into this world naked, such property as it may acquire being the result of contributions to its capital stock made by its stockholders. Taxes are paid upon the property of the corporation. This money comes out of the stockholders, because the value of their shares is proportionately diminished. A taxation of the shares of stock to the stockholder produces the same and no other result.

In studying the subject, we find a great deal of confusion in the decisions. When properly analyzed, there is very slight contrariety of views upon the essential legal principles underlying this case. We find it stated in many cases that the shares of stock are one thing and the capital stock and property of the corporation an entirely separate and distinct thing, and that both may be taxed in the same jurisdiction. The proposition, however, is subject to analysis and scrutiny and when these are exercised it will be found that in some states the legislature explicitly required that the property of the corporation, as well as the shares of stock, be separately assessed, and the supreme court of the United States has held that such statutes when enforced by the courts of the state, do not violate the Constitution of the United States. In other words as far as the courts have gone is to hold that in certain states such double taxation may legally exist, and that such form of double taxation does not violate the Federal Constitution; and when this is stated, it will be found that the opinions amount to nothing more.

For instance, take the case of Sturges v. Carter, 114 U.S. 511, 29 L.Ed. 240, where the rule is announced that a state might, without violating the Federal Constitution, tax both. However, in the case of State of Tennessee v. Whitworth, 117 U.S. 129, 29 L.Ed. 830, the supreme court of the United States pointed out that, while this thing might be done, such method of taxation was harsh, and should only be adopted when the statutes were not susceptible of any other construction.

It must be borne in mind that under the Federal Constitution double taxation is not prohibited. Sturges v. Carter, supra. Discrimination however, is prohibited. Sellover, Bates Co. v. Walch, 226 U.S. 112, 57 L.Ed. 146; Gulf R.R. Co. v. Ellis, 165 U.S. 150, 41 L.Ed. 666; Dobyns v. City of Los Angeles, 195 U.S. 223, 49 L.Ed. 169; Connolly v. Union Sewer Pipe Co., 184 U.S. 540, 46 L.Ed. 679; McFarland v. Sugar Refining Co., 241 U.S. 79, 60 L.Ed. 899; Greene v. L.R. Co., 244 U.S. 499, 61 L.Ed. 1280; Union Pacific R.R. Co. v. Board of County Commissioners, 247 U.S. 282, 62 L.Ed. 1110; United States v. Board of County Commissioners, 251 U.S. 128, 64 L.Ed. 184.

In the cases cited from state courts holding that the shares of stock in a corporation are separate and distinct things for taxation purposes, and that the shares are assessable to the shareholder, notwithstanding the fact that the corporation has paid taxes on the property imparting anything of value to the stock; in other words, there are cases where the state courts, dealing with their own statutes, hold that as to domestic corporations this method of double taxation is applicable and enforceable, and this rule will be found in a number of states. As we have indicated to the court, however, the presumption is always the other way, and such construction of statutes should be avoided, if possible, and only resorted to where the terms of the statute involved will admit of no other construction. 1 Cooley on Taxation (4 Ed.), p. 485.

This court has invariably held that such shares of stock are not taxable as to domestic corporations. But the important thing which we wish to call your Honor's attention to is the fact that when you come to the question of whether or not you will treat the shares of stock as one thing and the property of the corporation as another, the matter is no longer open in Mississippi, but has been closed, and is now precluded by a long line of decisions. An argument to this court on behalf of the appellant based on the theory that recovery should have been had because the property of the corporation and the stock of the shareholder are separate, distinct and taxable things is simply a re-presentation to this court of a proposition law which it has long ago declined to adopt. State v. Simmons, 70 Miss. 485; Robertson, Rev. Agt., v. K.C. Lumber Co., 77 So. 246; Robertson, Rev. Agt., v. Miss. Valley Co., 77 So. 253.

The whole question was again presented to this court and exhaustively argued in the case of Robertson, Revenue Agent, v. Mississippi Valley Company, 81 So. 799, and this court adhered to its former ruling, declining for taxation purposes to treat the property of the corporation and the capital stock as distinct things. See, also, Panola County v. Carrier, 92 Miss. 148.

This court has also in the following cases announced that a double taxation violated the public policy of the state. Thompson v. Holmes County, 67 Miss. 75; Bank of Oxford v. Oxford, 75 Miss. 504; State v. Simmons, 70 Miss. 485; Railroad Company v. Adams, 90 Miss. 599.

THE RULE IS APPLICABLE TO SHARES OF STOCK IN A FOREIGN CORPORATION. We think we have demonstrated to the court that in the state of Mississippi it is thoroughly settled that, as for taxation purposes, to assess both the property of the corporation and the shares of stock to the stockholders would be double taxation. Such is the law in Mississippi.

This court has, in a line of decisions which have become rules of property, taken this view of the matter. And not only that but the statutes which your Honors construed in State v. Simmons, supra, have been codified and re-enacted subsequent to the construction adopted by the court in State v. Simmons, giving legislative construction to the opinion of the court.

In Hammer v. Yazoo Delta Company, 103 Miss. 349; Henry v. Henderson, 103 Miss. 348; Shotwell v. Covington, 69 Miss. 735; Weatherby v. Roots, 72 Miss. 355; Hay v. Hay, 93 Miss. 732, 136 A.M.S. 548, 25 L.R.A. (N.S.) 182-N, this court has held that where a state statute has been construed by this court and is on codification of the laws re-enacted without material change the previous construction is controlling. The construction adopted by this court has been codified and re-enacted (Mississippi Code 1906, sec. 4267).

There may be some conflict in the authorities in the various states as to whether or not a domestic corporation should be assessed with its property and the shareholders with their stock, but there is no conflict of authority upon the point that in states where domestic shareholders are not subject to ad valorem taxes on their shares, in such states the question is almost uniform; in fact, we have not found a single dissenting opinion. It is held, almost without contrariety of view, that under such circumstances then the shareholder in a foreign corporation doing business in the state where its property is situated in the state and taxes paid thereon, is not liable for an ad valorem tax on the shares of stock. The cases make no difference on the question in respect to a shareholder in a domestic and a foreign corporation. We present the question herein that no such distinction could be made, but the fact remains, as we will demonstrate, that the question always turns on the construction which the highest court of the state puts on its own statutes in respect to the question as to whether or not the property of the corporation is taxable to it and the shares to the shareholder; and we think that the rule cannot be controverted that in states like Mississippi where, under the laws, statutes and decisions, shares of a domestic corporation are not assessed to the stockholders, the same rule applies to the shareholders in a foreign corporation, where its property is in the state and taxed.

See the following text books: Cooley on Taxation (4 Ed.), secs. 978 and 979; 26 R.C.L., 158. We now propose to give the court the adjudications of the different states upon the subject. Arkansas: Dallas County v. Banks, 113 S.W. 37. California: Burke v. Badlam, 57 Cal. 594; City County of San Francisco v. Fry, 63 Cal. ___. Colorado: Denver v. Hobbs' Estate, Ann. Cas. 1916, 823. Iowa: Bennett, County Treas., v. Finkbine Lbr. Co., 198 N.W. 1. Kansas: Patterson v. Board of Comm'rs., 109 P. 790. Kentucky: Commonwealth v. Bedham, 106 S.W. 247; Commonwealth v. Walsh, Tr., 117 S.W. 398; Commonwealth v. Fidelity Trust Co., 143 S.W. 1037; Whitaker v. Brooks, 13 S.W. 355. Louisiana: Chassahoil et al. v. Board of Assessors, 45 So. 604; Ficklin v. City of New Orleans, 85 So. 330. Maine: East Livermore v. Livermore Falls T. B. Co., 13 A. E. Cas. 631. Michigan: Stroh v. Detroit, 90 N.W. 1029; Voorheis, Pros. Atty., v. Walker, 198 N.W. 994. New Jersey: State v. Ramsey, 24 A. 445; Trenton v. Standard Fire Ins. Co., 73 A. 606. Oklahoma: Board of Comm'rs. v. Ryan, County Treas. Ohio: Hubbard, County Treas., v. Brush, 55 N.E. 829. Pennsylvania: Commonwealth v. Falls Brook Coal Co., 26 A. 1071. Tennessee: Tenn. Fert. Co. v. McFall et al., 163 S.W. 806; Sloan v. City of Columbia, 232 S.W. 663. Texas: Gillespie, Tax Collector v. Gaston, 3 S.W. 248. Vermont: Foster v. Stevens, 22 A. 78. Washington: Ridpath v. Spokane County, 63 P. 260. West Virginia: State v. Graybeal, 55 S.E. 598. Wisconsin: State v. Wisconsin Trust Co., 144 N.W. 290. Policy of United States Government to permit but one form of taxation. Same policy pursued Mississippi income tax law. Executive construction by various departments of state government the same. Forms of taxation to which foreign and domestic corporations subjected in carrying on business in Mississippi.

It would be well at this point to stop and draw a rule from the various cases which have been cited. The result of our investigation was that no state in the Union so construed its statutes as to impose an ad valorem tax on the property of either a domestic or foreign corporation, where the property of the latter was situated in the state and taxed, or subject to taxation, and at the same time assess the shares of stock to the shareholders.

We stated that the question did not depend so much upon the power of the state to do so, in so far as the fourteenth Amendment to the Constitution of the United States was concerned, but rather rested upon the broad principle that double taxation was abhorrent, and prohibited by the laws and Constitution of most of the states in the Union, and that such form of taxation was considered double taxation, and should only be resorted to in obedience to the mandates of a positive and unambiguous statute, susceptible of no other construction.

There are some cases holding that where substantially all the property of the foreign corporation is situated out of state shares of stock are subject to assessment, though there are a number of states where it is held that if any portion of it is situated within the state the shares of stock are not so assessable. The conflict in the authorities range around these two points. (a) Where all the property of the foreign corporation is situated out of the state; (b) Where only a very small portion of it is situated in the state.

But when we approach the question involved in this record, that all the property of every kind owned by the corporation is situated in the state and taxed, then counsel have not cited a single case where, under such facts and circumstances, the supreme court of any state has so construed its statutes as to impose an ad valorem tax upon the shareholders.

Counsel direct the attention of the court to section 6904 of Hemingway's Code of the state of Mississippi, which purports to provide a form to be furnished by the assessors to the taxpayer for listing his property, and in which the following language is contained: "Value of all shares or certificates of stock in any corporation, stock company, or association, domiciled outside of this state."

It would be appropriate in this connection to call your Honor's attention to the fact that in the brief of counsel for appellant in State v. Simmons, 70 Miss. 485, counsel for appellant makes the following statement: "Section 484, Code 1880, which is section 3751, Code 1892, providing for assessment rolls, requires that there shall be a heading for 'amount of shares in any corporation or company.'"

Yours honors held that the provision had no application to a domestic corporation, where the property was situated in the state and taxes paid thereon. So with the provisions quoted from section 6904 of Hemingway's Code. There is nothing in the statute which says imperatively that all shares of stock in a foreign corporation shall be assessed. The assessor is merely required to obtain the information by furnishing an appropriate list.

Again counsel for appellant call attention to section 6888 of Hemingway's Code, which is in the following language: "All taxable property brought into the state, or acquired, or held by any person before the first day of February, shall be assessed, and taxes paid thereon for the current year."

This identical provision was contained in the Code of 1880, construed by the court in State v. Simmons, and your Honors held that the section was fully complied with by a domestic corporation where its property was situated in the state and taxed. Keeping in view the justice of equality of taxation, and assuming the legislative will to be that no other result shall be reached by the plan it provides, the courts have uniformly construed revenue acts, unless unequivocally and clearly expressing a different purpose, as intended to levy a single tax only upon the same property, even though the words of the law would ordinarily and naturally bear a broader and more general meaning. Bank v. Nashua, 46 N.H. 389; Smith v. Burley, 9 N.H. 423.

On the rule of construction to prevent double taxation, many decisions are collected in Cook on Stock and Stockholders, section 568, Note 1.

It is claimed that this corporation may have a franchise of some value; that the franchise is situated outside of the state, not taxable in Mississippi and that, therefore, the shareholders should be assessed with the stock. It is well settled that the franchise of a corporation is taxable whenever it is used and exercised, and, therefore, if this corporation, as is shown in the declaration, owns property nowhere except in Mississippi, it may be assumed that it carries on business nowhere else, and that every franchise which it exercises is carried on in the state of Mississippi. This being true, the franchise is taxable in the state of Mississippi.

In the case of Adams Express Co. v. Ohio, 166 U.S. 185, 41 L.Ed. 965, the supreme court of the United States held that the franchise of the Adams Express Company, a New York corporation, which was doing business in the state of Ohio, could be assessed for ad valorem taxes in the latter state.

In the following cases, it is held that a corporate franchise is of value, and taxable wherever the corporation is engaged in exercising such franchise powers: Cosmopolitan Power Co., C.C.A. 137 Fed. 862; London Bank v. Block, 117 Fed. 905; Irrigation Co. v. Merced (Cal.), 84 P. 288; Rhode Island Hospital v. Tax Assessors, (R.I.), 55 A. 879; Southwestern Tel. Co. v. San Antonio (Tex.), 73 S.W. 861; Union Transit Co. v. Lynch, 55 P. 642.

Counsel contend that the appellee should be assessed with the shares of stock in the foreign corporation because a foreign corporation itself is not assessable with any capital stock; that the state of Mississippi cannot assess the capital stock of a foreign corporation, it being confined to an assessment of its property. This court has never decided that a foreign corporation, which has its principal office in the state of Mississippi, where all the property is situated in the state of Mississippi, where all the business it carries on is in the state of Mississippi, is not assessable in the state of Mississippi with its capital stock, deducting therefrom its visible property, as a domestic corporation is. That may be true. We do not find it necessary to controvert the point; but, as applied to the effort in this case, there are a number of obvious replies.

The record in this case shows that all the property which the corporation owns is situated in the state of Mississippi, and that it is assessed with property for an amount in the aggregate which equals the full value of its capital stock.

Your honors might ask the question, why would a business man in Mississippi engage in business under a foreign charter? Why not take out a domestic charter? And, in view of the attitude which we occupy, the question would require a frank answer.

(a) The corporation laws of the state of Mississippi have not been changed since the Code of 1892, and, therefore, have not kept pace with the commercial development of this country. Under the statutes of the state of Mississippi there is no authority for dividing shares of stock into classes; there is no authority for vesting the management of the corporation in the hands of certain shareholders; there is no provision for preferring one class of shareholders over another. A man may wish to give members of his family, or to employees, a certain class of stock, and, at the same time reserve an entirely different class for himself which would have the management and control of the corporation. No public policy is involved; nobody is interested, except the parties. The humanitarian method in carrying on business, and progressive commercial life, require charters of this character. It is necessary, therefore, that a foreign charter be obtained. The parties obtaining them have no desire to violate either the law or the public policy of the state; they are honorable, upright people, contributing to its moral and material welfare; contributing in a very substantial manner to the support of the Nation, the state, and all of its subdivisions.

(b) The taxation of a foreign corporation is probably more simple. A foreign corporation pays exactly the same taxes upon its property which an individual would pay, and, no other. Section 181 of the Constitution states the property of all private corporations for pecuniary gain shall be taxed in the same way, and to the same extent, as the property of individuals. There is no element of property which a foreign corporation would own in Mississippi which would be liable to taxation just as if the property belonged to an individual.

If section 6878, Hemingway's Code, section 6888, Hemingway's Code, section 6904, Hemingway's Code, section 6905, Hemingway's Code, or either of them, shall be construed by this court as to justify or require the shares of stock involved in this suit to be assessed to the appellee, or so as to permit a recovery therefor, then such statutes, and each of them, violate section 14 of the bill of rights of the Constitution of the state of Mississippi, as well as the Fourteenth Amendment to the Constitution of the United States, for that by reason of such construction the appellee would be deprived of his property without due process of law, and would be denied the equal protection of the law.

Argued orally by Garner W. Green, Earl Floyd, and L.F. Easterling, for appellant, and W.H. Watkins, for appellee.